BPO outsourcers face grim outlook, says analyst

Half of all businesses involved in business process outsourcing will be hit by cost over-runs and unacceptable levels of service over the next three years, analysts have warned.

Analyst firm Gartner said firms that outsourced their business processes faced this grim outlook because they failed to understand the outsourcing market and were taken in by hype.

Gartner research vice president Lisa Stone said, “It’s clear that buyers across the market are experiencing consistent and pervasive hype concerning which processes and service providers can truly deliver on the promise of business process outsourcing.”

She urged businesses to create an internal outsourcing strategy in order to determine the best offer that could achieve their goals.

“Then use a structured sourcing process through vendor evaluation, contracting and negotiating and creating an internal management support team to ensure that all details are in place to support the service before signing an outsourcing contract,” she said.

Gartner believes two specific BPO services can make a transformational impact – core banking, and comprehensive finance and accounting. But both markets are “far from mature”, the analyst firm warned.

Contact centre outsourcing – expected to plateau in less than two years – was a more mature market, offering a high-level impact.

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